Month: December 2018

A few years ago, the Supreme Court held that the ACA individual mandate was outside the scope of the Commerce Clause, but was authorized by Congress’ taxing power.  It was a ridiculous decision, based on about eighty years of precedent, and it was obviously an ungainly political compromise, but at least it kept the law in place.  It obviously could have been much worse.

Congress subsequently eliminated the tax penalty that was attached to the individual mandate as part of the Trump tax cut.  A number of individual right-wing zealots and red state governments subsequently filed a challenge to the remainder of ACA on the basis that the individual mandate was now unconstitutional, and that the invalid mandate provision could not be severed from the rest of the legislation.  That argument flew in the face of a record which showed that the 2017 tax legislation was not intended to repeal the rest of ACA.  And, indeed, virtually every GOP incumbent who ran in 2018 claimed to support protections for people with pre-existing conditions.

Today, a federal judge in Texas plausibly held that the 2017 tax cut rendered the mandate unconstitutional, but he went further and refused to sever the mandate from the rest of the legislation–even the Medicaid expansion, which was logically unrelated to it–on the basis that the intent of the 2017 Congress could not be determined from the record, which allegedly focused solely on the need to cut taxes.  Amazing!

I can’t wait to see what Susan Collins says when a reporter asks her if it was her intent to completely repeal the ACA when she voted for the tax cut.  Fortunately, the District Court decision is hardly the last word on the matter, but it is incredibly annoying, just the same.

A:  The only refugee from the Trump administration who left with her reputation intact.

Q:  Who is Nikki Haley?

He’s So Vain

He walked into the White House

Like he was walking into Trump Tower.

He had just been elected president.

He truly was the man of the hour.

His ego raged out of control

As those around him fawned.

McConnell and Ryan said they’d be his partners.

They’d be his partners and . . . 

(Chorus)

He’s so vain

He probably thinks this song is about him.

He’s so vain

I bet he thinks this song is about him.

It is, it is, it is.

Well, he had the country years ago

When the voters were quite naive.

Told the radical right that he was their man

And that he would never leave.

But he screwed his friends and foes alike.

Now no one is deceived.

His people had dreams

They were fools to believe them, fools to believe them, and. . .

(Chorus)

Parody of “You’re So Vain” by Carly Simon

Assume that you are designing a single-payer system similar to Bernie Sanders’ Medicare for All from scratch.  Here are some of the major issues, and my analysis:

1.  Who pays?  The Sanders plan relies on a mish-mash of taxes that probably isn’t sufficient to avoid running a substantial deficit.  Logically (at least to me), a universal health care program should be paid for by society as a whole, not just by the wealthy, who probably couldn’t afford to bear the entire burden in any event.  That means a new tax impacting everyone, like a VAT or a carbon tax.  
2.  Will there be co-pays?  The Sanders plan says no, but most universal health plans do include them, partly to defray the very high cost of the plan, and partly to prevent frivolous overuses of the system.  Regardless of what Sanders might think, co-pays will almost certainly be included in a single-payer system if one is ever adopted.
3.  What happens to Medicare?  Logic tells you this is a simple question; it would just be folded into the more generous, universal system.  Experience tells you something different; the elderly are going to be concerned that the new system will siphon money away from them in favor of younger people who never paid into the system.  At a minimum, a huge amount of education and outreach would be required to permit the creation of the universal system.
4.  Will private insurance continue to exist?  As I understand it, Sanders says no, but even the NHS operates with a degree of private insurance.  It will be difficult to prevent that from happening here.
5.  How will the program be sold to workers who currently get insurance through their employer?  The success of the new system will depend to a large extent on the willingness of employers to pass their savings on the their workers in the form of higher wages.  Will that actually happen?  In the real world, it will depend on conditions, and vary from employer to employer.  As a result, some workers will be worse off with the new system; it just can’t be avoided.
6. How in the world can you get this massive change through a political system that is largely designed to discourage such changes?  Regardless of its merits, the obstacles are just too great.  Sanders will really need some sort of a revolution to make it happen.

As one would have predicted, Theresa May has the support of a small majority of her party, but not of the House of Commons.  This is a recipe for deadlock, and a no-deal Brexit.  How can the deadlock be broken?

It doesn’t appear that the EU is going to give her anything to bail her out.  Corbyn could change the equation by offering a second referendum and a new election, but he doesn’t seem to want to do that; he thinks the government will implode on its own and just drop power into his hands.  May’s new plan seems to be to put off a vote until disaster is imminent and hope that the crisis will help everyone concentrate.

I don’t think that will work; the opposition has no reason to cooperate, and the Tory Brexiteers are too dug in to change course.  If I were a betting man today, I would put my money on no deal.

By all rights, the 2020 election should be a referendum on Donald Trump.  Based on his poll ratings and the outcome of the midterms, if there are no major unforeseen changes (an unlikely event, to be sure), a generic Democrat should be a solid favorite to win.  The Democrats, however, will nominate an actual flesh and blood person, not a generic candidate.

If, as seems likely, the chosen one supports a single-payer program, the GOP will attempt to change the terms of the debate by focusing on the costs and risks of making a dramatic change to an industry that represents, I believe, about 17 percent of our GDP.  You can anticipate a blizzard of commercials from both medical providers and the Trump campaign that will make Harry and Louise look like kindergarten.  Here are the likely messages and targets:

1.  Insurance company employees:  You’re losing your job.  Duh.
2.  Health providers:  Your income is going to be cut dramatically in exchange for a small reduction in paperwork.  Is it really worth it?
3.  The elderly:  You worked hard all your life to build up a Medicare “nest egg.”  Now the program is in danger of being diluted in favor of shiftless younger people who didn’t contribute as much to the system as you did all those years.  The Democrats say the new program will be better, but do you really trust the government to improve anything?  And oh, by the way, DEATH PANELS!  DEATH PANELS!
4.  Workers with employment-based insurance:  You’re going to be giving up perfectly good insurance, and paying higher taxes, in return for a promise that your wages will go up and your costs will go down.  Do you really trust either the government or your employer on such an important matter?
5.  Every consumer:  RATIONING!  LONG LINES!  LOSING YOUR DOCTOR! SOCIALISM! And don’t forget DEATH PANELS!

Hillarycare died in the face of insurance industry opposition.  Obamacare barely survived opposition from the GOP, under much better political conditions;  it got through the Senate with no margin of error.  In light of that, is it really wise to make an extreme form of single-payer the focal point of a campaign?  Do the Democrats really want to make 2020 about that issue, and not about Trump’s shortcomings?

Most Americans, including myself, are not very familiar with the horde of likely 2020 Democratic presidential candidates.  The debates will play a huge role in separating the sheep from the goats.

Presidential debates, particularly if they involve large numbers of people, are not a forum for nuance and tradeoffs; they reward candidates with simple solutions and zippy zingers.  

When you apply that to the various options for single-payer, you have a potential problem.  My fear is that the most extreme versions, which promise the moon and the stars and suggest that rich people will pay for almost all of it, will drive out the more responsible and balanced alternatives, simply because they will be easier to understand.

There are significant conceptual and political issues with single-payer that have the potential to turn into a nightmare for the Democrats in the 2020 general election.  If they are not handled properly, they could win the election for Trump.  More on that during the next two days.

If there is one thing we know about Republicans, it is that they hate taxes, right?  Well, a tariff is a tax.  It is money paid by law to the US government that is ultimately priced into the cost of goods.  It is sort of a specialized federal sales tax on specified imported products.

So why isn’t the GOP going bonkers over the Trump tariffs?  Why isn’t Grover Norquist threatening to slash his wrists?  Why do we hear nothing but a low level of unhappy mumbling from Republican leaders?

Two reasons.  First, the GOP is really concerned about taxes that are paid disproportionately by its donor class, such as income, capital gains, and estate taxes.  The other ones don’t mean nearly as much, the party’s general anti-tax and pro-freedom rhetoric notwithstanding.  Second, the party is in such thrall to Trump and his white nationalist followers that even its purportedly core beliefs have to give precedence to the whims of the man on golf cart.

And if you think that sounds pathetic, you’re right.

Why is the minimum wage included in a discussion of the welfare state?  Because it is essentially a tax on employers that funds a redistribution of wealth that is mandated by the government.  It is a welfare program in disguise.

From the perspective of the Democrats, increases in the minimum wage make for excellent politics, for two reasons.  First of all, the disguise typically works; the recipients of the increase do not feel like welfare queens, since they do not receive a check from the government.  Second, the wealth redistribution is tied directly to work, which satisfies the inner Victorian in so many Americans.  No one is getting cuts in line here.  No wonder reactionary workers can be persuaded to vote for minimum wage referenda, and they actually have a fighting chance in red states.

Economically, while studies have consistently shown that fairly small minimum wage increases do not have a major impact on overall wage or employment levels, large increases probably would.  Job losses, inflation, and higher interest rates would be a bad tradeoff in exchange for the higher wages.  And why should employers be required to pay more than the market demands?  If society insists that workers be paid a living wage, why shouldn’t the country as a whole pay for it–not just employers?  Why aren’t wage subsidies a better answer?

As you can see, I’m ambivalent at best on this subject.  For political reasons, I can tolerate promises of federal legislation increasing the minimum wage as long as the increase is kept reasonably low and regional variations are tolerated.  A $15 dollar minimum wage might make some sense in Manhattan, but it will destroy jobs in Nebraska.

Will such a balanced program fly in the 2020 primaries?  I have my doubts, but we’ll see.

Reasonable people can disagree as to whether the USMCA is better or worse than NAFTA.  I would say it’s slightly worse, because it will result in increased costs for the auto manufacturers, and thus create an incentive to move production completely out of North America, but that is a debatable point.  What isn’t debatable, in my opinion, is that the final product wasn’t worth all of the drama and the hostility.  It just isn’t that different from NAFTA.

So how will the Democrats react to the USMCA?  Here are four possible outcomes, ranked in order of their desirability:

1.  The new Democratic House votes against it on the basis that it does too little to protect workers’ rights.  NAFTA remains in place.  The Democrats have a pro-worker stick with which to beat the GOP in 2020, and there are no negative economic impacts.
2.  The USMCA is considered in the lame duck Congress and passes without Democratic votes.  Economic conditions are marginally worse, but the Democrats still have the stick.
3.  The USMCA passes in the new Congress with some Democratic votes.  Nothing good comes from this, and Trump gets a desperately-needed “win.”
4.  The USMCA fails in the new Congress, but Trump petulantly moves to withdraw from NAFTA in spite of desperate pleas from the Chamber of Commerce.  Chaos and litigation ensue.  It is the American equivalent of a no-deal Brexit.

#4 is the worst case scenario.  It cannot be entirely dismissed.

In today’s developments, the PM has decided to postpone the vote that was previously scheduled for tomorrow in order to avoid a humiliating defeat.  One imagines her next move will be to go to Brussels, pitch a fit in front of the TV cameras, receive little or no satisfaction in return, and tell Parliament “See!  I told you that was the best deal on offer–so vote for it unless you want chaos or a second referendum!”

Will that work?  I will be surprised if it does.

As my readers know, I have recommended that the Democrats roll back the most egregious parts of the Trump tax cut and use the proceeds to fill the fiscal gaps in the existing welfare state, including Social Security.  Why?

Because it is both good politics and good policy.  Here are my reasons:

1. The Republicans have won a substantial majority of elderly voters in the recent past in spite of their well-publicized plans to cut and/or privatize Social Security and Medicare.  In the last election, however, there were some signs that the elderly are becoming more receptive to the Democrats.  Making a very conspicuous gesture to support Social Security would definitely help, and would force the GOP to deal with a difficult dilemma:  agree with the plan to raise taxes and antagonize the donor class; or refuse and be seen as supporting big cuts to Social Security for the benefit of the wealthy.
2. Deficits in the two programs definitely do exist and threaten their long-term viability.  At some point, the issue has to be faced.  Better now than when your back is against the wall, and the GOP has leverage to force extensive cuts.
3. What are the other alternatives?  To raise the payroll tax?  The burden of financing the welfare state should fall on the country as a whole, not just workers and employers.  In addition, raising the payroll tax would effectively result in a pay cut at a time when stagnant wages are a huge problem, and the increased costs would only encourage employers to automate or send jobs overseas.  Does that sound like a good idea in today’s world?

I’ve never interviewed Joe Biden, and I probably never will.  But if I did, it would go something like this:

C:  Mr. Vice-President!  Thanks for meeting me.

B:  My pleasure.

C:  I’m guessing that if I ask you if you’re running for president, you will say you haven’t decided, but you’re giving it serious consideration.

B:  That’s just about it.

C:  Do you have any regrets about not running in 2016?

B:  Yes and no.  Yes, in that I think I would have won and spared the country from Trump. I have deep regrets about that.  No, in that I wasn’t completely ready to make the commitment.  It’s not a simple issue.

C:  Let me make the case for and against your candidacy in 2020 and give me your reactions.

B:  Sure.

C:  On the pro side, you are, beyond question, the best qualified candidate, and that means something, particularly in light of what is happening today.  You have plenty of experience with nationwide campaigns.  You can appeal to white working people.  You might well be the candidate who has the best chance to bring the country together.  Does that sound about right?

B:  Yes.

C:  On the con side, you’re too old.  You’re too tied into the Obama years–the world has passed them, and you, by.  You’re a gaffe machine, and you have some skeletons in your closet, particular in the age of MeToo.  While you did well as a VP candidate, your presidential campaigns didn’t end well.  You should just settle for being an elder statesman and leave the 2020 campaign to younger people.

B:  Let me respond to each part of that individually.  As to being too old, I’m younger than Bernie Sanders, and just barely older than Trump.  I’m in great shape, both physically and mentally.  And being old means I have plenty of experience, which always comes in handy.

C:  OK.

B:  The world hasn’t passed me by.  I’ve been out on the campaign trail working for Democratic candidates for the last couple years.  I understand what’s bothering Americans as well as anyone.

C:  You’ve admitted you’re a gaffe machine.

B:  Not next to Trump.  He’s a lie machine.  That’s a lot worse.

C:  What about the Anita Hill thing?

B:  I know times and standards have changed.  I just ask women to look at my record as a whole.  In any event, next to Trump, I’m a saint.  No one would dispute that.

C:  What about your previous campaigns?

B:  I’ve learned a lot since then.  That’s the advantage of experience.  None of the other candidates have been through that.  Everyone already knows my weaknesses; theirs will be exposed in time.

C:  I have suggested that the likely Democratic candidates can be put on a graph, with the axes being realo/fundi and identity/class.  Where would you put yourself on that graph?

B:  I’m definitely a realo.  I don’t believe it makes sense to promise things you can’t possibly deliver.  As to identity/class, I would say class, but it’s a debatable point.  I’ll leave that to you.

C:  Let’s talk about the two axes.  If I’m a fundi, my argument is that nothing ever happens if you don’t dream and fight for it, and that we can’t appeal to a wide range of Americans if we don’t promise anything that makes a difference to them.  How do you respond?

B:  It’s not a simple question.  There are issues like racism on which you just can’t compromise.  I agree with fundis on that.  But in general, if you make promises you can’t keep, you just create frustration among the voters that ultimately endangers the system as a whole.  Think about Brexit, or, in this country, what has happened with the Freedom Caucus.  

C:  There is a school of thought to the effect that the primaries will be largely about Obama’s legacy–whether it is something to be cherished and built on, or whether we need a “revolution.”  What do you think?

B:  That’s definitely going to be a theme during the primaries.  I know a lot of activists tend to support a “revolution,” but I don’t think the average primary voter does.  One way or another, we’ll probably find out.

C:  What about the identity/class issue?  Do you think the Democratic Party is primarily defined by class, or identity?

B:  Identity, but it needs to be about both if we want to win.  Writing off white working people is political suicide, and just plain wrong.  I think I’m better positioned to bring them back than any of the other candidates.

C:  Do you agree with Bernie Sanders that the Clinton campaign was too identity-oriented, and did too little to emphasize what unites Americans?

B:  I don’t ordinarily agree with Bernie, but I’m with him on that.  Ultimately, it’s about an American identity, and how all of the various groups are part of a larger mosaic.  The individual parts are extremely important, but so is the mosaic.

C:  Given the filibuster and the makeup of the Supreme Court, what do you think the priorities of the next president should be, and what can realistically be promised?

B:  The first priority has to be to restore integrity and competence to the federal government.  We need to wipe out Trumpism altogether.  We need to unite the country, not divide it.  After that, we need to create an America that is fair to everyone, and not just the wealthy.  We need to take effective action to slow down climate change.  We need to restore our relationships with our allies.  There’s so much to do!

C:  That sounds like building on Obama’s legacy.

B:  That’s a realistic program.  I don’t think America is crying out for new and hugely expensive government programs, and the filibuster will make it impossible, anyway.  I think the public is demanding that we fill in the holes that exist in the current programs, and to make government work for everyone, not just a handful of rich white guys.  I think that’s what the country really wants.

C:  Thank you for your time.

Angela Merkel is on her way out.  Macron is fighting angry populists for survival.  The UK is leaving the EU, if it can.  The Italians are refusing to comply with EU budgetary rules.  Trump, of course, views the Europeans as unscrupulous and parasitic competitors, not allies, and it’s not as if Xi has any reason to help.

In short, the door is open for Putin to engage in plenty of new mischief until the vacuum has been filled, as it will ultimately be, in one way or another.  Don’t be surprised if he exploits the opportunity, probably starting with Ukraine.

The good news is that our voter suppression measures are working! With the help of some of the courts, we’re keeping the minority votes down a little bit.  It has made a difference in a few close races.

The bad news is that it didn’t make enough of a difference to win in 2018.  We need something much bigger than that for 2020.  What should it be?

The answer comes, as it frequently does, from our brothers in Wisconsin, who have recognized that the problem is blue voters who live in cities.  They’re not real Americans, after all.  Jefferson said so, and so did Sarah Palin.  How could both of them be wrong?

So here’s an idea:  let’s limit the franchise to people who own single-family detached homes.  They’re real Americans, because they’re truly invested in their suburban and rural communities.  They vote Republican, too.  They’re our kind of people.

Hey, if it was good enough in the 18th century, it should be good enough for us.

The one thing we need to avoid is literacy tests.  As our beloved leader, President Trump, once said, we love the poorly-educated.  They remind us of ourselves.

Talk about identity politics!